Vehicle Buyers with More Disposable Income Purchasing Import Models as Availability Increases, J.D. Power Finds
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Volkswagen Ranks Highest among Mass Market Brands; Lexus Ranks Highest among Luxury Brands
SINGAPORE: 1 Oct. 2018 — With an increasing number of import models now available in the Taiwan market, the proportion of buyers purchasing an import mass market model has almost doubled during the past 5 years (33% in 2018 vs. 17% in 2014), according to the J.D. Power 2018 Taiwan Sales Satisfaction Index (SSI) Study,SM released today.
Purchasing power is an important driver of this buying behavior, as the monthly median income of those buying an import model is 10 percentage points higher than among those who purchase a domestically produced model. Additionally, import vehicle buyers are spending more of their household income to purchase their vehicle, compared to buyers of domestically produced vehicles (10 months of income, on average vs. 8 months of income, on average). Interestingly, the study also finds that a larger proportion of import vehicle buyers than domestic vehicle buyers are self-employed (14% vs. 10%, respectively) or are in senior/middle management roles, compared to domestic vehicle buyers (19% vs. 10%, respectively).
“More disposable income enables buyers to afford a wider spectrum of vehicle models,” said Kaustav Roy, Regional Director at J.D. Power. “The increased availability of import models not only offers buyers more choices, but also strengthens competition in the industry. For manufacturers to stand above the competition, it is crucial that they differentiate their offerings according to their customers’ profiles and purchase reasons.”
Buyers purchasing import models cite the performance of the vehicle, followed by both the exterior and interior styling, as key influential purchase reasons. For domestic models, the most influential purchase reason is good fuel efficiency, followed by interior styling.
The following are additional key findings of the study:
A large proportion of buyers conduct online vehicle research prior to dealer visit: Nearly two-thirds (62%) of buyers say they used the internet to shop for their vehicle. Of these, 43% visited OEM websites and 38% visited third-party websites.
Nearly one-fifth of those trading-in vehicles feel price lower than expected: One-fourth of all buyers (25%) traded-in their previous vehicle to purchase their current vehicle. Among these, 17% say the price received for their trade-in was below their expectations.
Pressures during purchase: Slightly more than one-third (34%) of buyers say the dealer exerted pressure when trying to sell the vehicle, and 11% say they had difficulty in getting a clear answer about the vehicle price.
Volkswagen ranks highest among mass market brands with an overall score of 822 (on a 1,000-point scale). Luxgen ranks second with a score of 811 and Mazda ranks third with a score of 810.
Lexus ranks highest among luxury market brands with an overall score of 843, while Mercedes-Benz (840) ranks second and BMW (827) ranks third.
The 2018 Taiwan Sales Satisfaction Index (SSI) Study is a comprehensive analysis of the new-vehicle purchase and delivery experience. The study is based on responses from 2,752 mass market segment new-vehicle buyers and 875 luxury segment new-vehicle buyers who purchased their vehicle between August 2017 and May 2018 and was fielded between February and July 2018.
Now in its 20th year, the study has been entirely redesigned and now examines five factors that contribute to overall customer satisfaction with the new-vehicle purchase experience. In order of importance, they are sales consultant (26%); dealer facility (22%); delivery process (21%); working out the deal (18%); and paperwork completion (13%).
The study now also includes Net Promoter Score® (NPS), which measures customers’ likelihood to recommend both their vehicle make and model on a 0-10 scale.
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About J.D. Power in the Asia Pacific Region
J.D. Power has offices in Singapore, Bangkok, Beijing, Shanghai and Tokyo that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries in the Asia Pacific region. Together, the five offices bring the language of customer satisfaction to consumers and businesses in Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, Philippines, Singapore, Taiwan, Thailand, the U.A.E. and Vietnam. J.D. Power is a portfolio company of XIO Group, a global alternative investments and private equity firm headquartered in London, and is led by its four founders: Athene Li, Joseph Pacini, Murphy Qiao and Carsten Geyer. Information regarding J.D. Power and its products can be accessed through the internet at asean-oceania.jdpower.com.
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